Client Alerts & Publications

INVEST in America Act Offers $494 Billion in Funding to U.S. Infrastructure and Millions of New Jobs

The Investing in a New Vision for the Environment and Surface Transportation in America (INVEST in America) Act was approved by the House Transportation and Infrastructure Committee on June 18, 2020 and is making its way up to Congress. The bill will create millions of jobs and provide substantial investment in the nation’s deteriorating highways, bridges and public transit systems. The bill also endeavors to leave behind a smaller carbon footprint, a major improvement for the nation’s biggest source of carbon pollution.

Investing in a New Vision for the Environment and Surface Transportation in America Act

According to the American Society of Civil Engineers, the current condition of the nation’s infrastructure earns a grade of D+, and there exists an estimated $2 trillion funding gap to bring it into a state of good repair by 2025.  While Americans have benefited from a century of infrastructure building, neglect has befallen our once greatest achievements – the roadways and arteries that led to the explosive growth of our nation. In the 1930s, 4.2 percent of the country’s GDP was spent on infrastructure investment. Unfortunately, by 2016 that number fell to 1.5 percent resulting in the substandard conditions that now confront us. Stated more bluntly, our nation’s infrastructure is crumbling and immediate investment in required to bring it up to par. The INVEST in America Act is our “immediate” opportunity to start replacing the outdated systems of the past with smarter, safer, and more resilient infrastructure.

The INVEST in America Act is a 5-year, $494 billion investment recognizing the need to fund new, innovative projects that will create millions of jobs and support American manufacturing and ingenuity while reducing carbon pollution, dramatically improving safety, and spurring economic competitiveness. Investments subject to the bill include $319 billion for highways, $105 billion for transit, $10 billion for passenger vehicle and commercial motor vehicle safety investments and $60 billion for rail investments.

A major portion of the bill is reserved to address some the nation’s most urgent infrastructure needs, which includes some the following grants administered by state transportation agencies:

  • Fix It First: Requires National Highway Performance Program (NHPP) funds to focus on state of good repair and operational improvements to existing facilities before building new highway capacity.
  • Bridge Investment: Requires States to spend 20 percent of their NHPP funds and Surface Transportation Program (STP) dollars on bridge repair and rehabilitation projects, supporting approximately $28 billion in fix-it first bridge investments in Fiscal Year 2022-2025. Increases the off-system bridge set-aside to over $1 billion per year from approximately $770 million in current set asides.
  • Local control: Provides almost $49 billion over five years in dedicated funding to address local transportation needs.
  • Tribes, Territories, and Federal Lands: Significantly increases funding for tribes, territories, and Federal Land Management Agencies (FLMA):
    • Tribes: Provides $750 million in formula funds per year, a nearly 70% increase over current levels.
    • Territories: Provides $100 million per year, a nearly 140% increase over current levels.
    • Puerto Rico: Provides $210 million per year, a 33% increase over current levels.
    • FLMAs: Provides $895 million in formula funds per year, a nearly 40% increase over current investments, and makes changes to the program to ensure FLMAs can obligate funds for projects on the first day of the fiscal year.

Some of the discretionary grants include:

  • Projects of National and Regional Significance. Provides more than $9 billion over the life of the bill for large highway, transit, and freight projects that cannot be funded through annual apportionments or other discretionary sources.
  • Community Transportation Investment Grants. Provides $600 million per year for local government applicants. Includes broad eligibility for highway and transit projects.
  • Community Climate Innovation Grants. Provides $250 million per year to non-State applicants for highway, transit, and rail projects, provided they reduce Greenhouse Gas emissions.
  • Metro Performance Program. Provides a total of $750 million over the life of the bill for funding allocations directly to MPOs to carry out projects selected by the MPO. The Secretary selects applicants to be accepted into the program based on their technical capacity to manage Federal funds.

The bill also responds to the COVID-19 crisis and authorizes $83.1 billion in funding for fiscal year (FY) 2021 to ensure States, cities, tribes, territories, and transit agencies can administer programs, advance projects, and preserve jobs in the Nation’s current economic climate. The bill authorizes this sharp increase in funds to continue current programs in the first year of enactment with wider policy implementation occurring in FY 2022.

Conclusion

The INVEST in America Act is a major step forward for the transportation industry and will create millions of jobs needed during this economic crisis.  While one may, at first glance, consider that this bill was drafted to address our country’s reputation for carbon emissions and climate change, this bill does much more. With the bill’s “fix it first” policies, our roadways, bridges, and transit systems will receive long overdue initial funding needed to help bring our roadways into the 21st Century.

Stefanie A. Salomon is an Associate in Peckar & Abramson’s Miami office. She can be reached via email at ssalomon@pecklaw.com.

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